Month: January 2016

When a project is abandoned by the builder, can the flat purchaser insist on a refund of the amount paid by him? Or would the builder be entitled to insist that the customer should opt for another flat in some other project? In a recent judgment dated January 4, the National Commission’s Bench of Justice J M Malik and Dr S M Kantikar, has held that the flat purchaser would have the right to get his money back along with interest and compensation.

Case Study: Reshma Bha gat and her son Tarun sold a plot of land owned by them in Bangalore. The money had to be invested to avoid capital gains tax, so they booked a flat in Delhi in a project called Napolean I, undertaken by Supertech Ltd. The flat was a 7-star luxu rious 4BHK apartment with servants quarters in Czar Suites, admeasuring 2,490 sq ft super built up area, costing Rs 73,84,300.

The allotment letter stated that possession would be given latest by December 2009. In case of delay, the builder had agreed to compensate the flat purchaser by paying damages at the rate of 5% per sq ft per month for a period of 12 months. An agreement was also executed.

Till September 2008, the Bhagats had paid Rs 63,99,727, nearly 87% of the agreed amount. When they went in March 2009 to inspect the progress of work, they found that no construction was being carried out.They recorded this in a letter, followed by two reminders. The builder responded, saying possession would be given by October 2010 and he would pay compensation for the delay as per the agreement. The Bhagats claimed that the agreed com pensation for delayed possession was too low, and demanded penal interest at a rate equal to banks levying on corporate hourses for loans advanced. The builder later admitted he had not constructed any 4 BHK flats in Napoleon I project, and instead offered a similar flat at another location. This was not acceptable to the Bhagats, who sought a refund of the entire money paid by them, along with interest. As the buil der refused to comply , they filed a complaint before the National Commission, claiming a refund of their money along with interest, compensation and costs, totalling about Rs 1.4 crore.

The builder contested the complaint. He questioned the jurisdiction of the National Commission. The builder also claimed the Bhagats were investors and not bonafide flat purchasers. The builder argued that the agreement provided that he would be entitled to offer an alternative flat, but the Bhagats had not accepted this offer.

The failure to construct Na polean I project was due to circumstances beyond its control, so it would be incorrect to consider the delay as a deficiency in service.

The National Commission overruled all the objections. It held the complaint to be maintainable as jurisdiction would have to be determined according to the value of the reliefs claimed, which was Rs 1.4 crore.Regarding offer of alternative flats, the commission held that nobody could force a consumer to accept another flat. Such a clause in the agreement would be arbitrary and un-enforceable. The builder alsofailed to produce any evidence to show why the project had been delayed.

Accordingly , the commission directed the builder to refund the entire amount of Rs 63,99,727 along with interest at 18% pa from the date of payment till refund.

Impact: A builder cannot compel the flat purchaser to opt for any other flat in lieu of the one agreed to be sold. The customer would have the right to get a refund of his money , along with suitable compensation.

The decision to issue a passport or not is a sovereign function. The Govt. of India does have the right to reject issue or rejection of Passport in appropriate cases.

Having said that, not issuing a passport for wrong and invalid reasons can amount to deficiency in services. And the aggrieved person can approach the Consumer Forums or the High Court for relief.

4 January 2016 – Bombay High Court

The Bombay High Court took the passport office to task over pending applications and rejections without valid reasons.

A division bench comprising Justice S C Dharmadhikari and Justice B P Colabawalla issued a warning to the passport office that if the court came across such cases in the future, the concerned passport officer would be penalized heavily.

Brief Facts of the Case

A Kandivali resident Amit Agarwal filed a writ that his passport, which was renewed in 2013, had been abruptly cancelled after he approached the passport office to get his birth date corrected on it.

Agarwal’s lawyer, Vivek Kantawala, informed the court that the passport was cancelled without giving his client a hearing. Agarwal is a businessman who travels often – substantiated by the numerous visa stamps on his previous passport. He had applied for a renewal of his passport well before its expiry date of July 2014, and was provided with the same in 2013.

However, when he approached the passport office to correct his birth date, which showed that he was a year younger than he was, the passport office cancelled his passport saying that Agarwal had failed to disclose a case that had been filed against him by his wife. Agarwal, in his petition, had said that the disclosure of the case was not held relevant by him as it was filed after he had already received his renewed passport.

When the court inquired from the passport office about the compliance of the sections pertaining to the issuance of passports/travel documents, which mandate an order, the passport authorities had no reply. The court then issued a warning to the authorities, directing them to pass an order on Agarwal’s application by January 11.

Court’s Observations

“We fail to understand as to why this court’s precious time should be wasted by the regional passport officer by forcing parties, like the petitioner, to approach this court and seek a direction of such nature. The passport officer must realize that it is his obligation and duty to consider the application. The applications, as made online, or presented physically, have all to be considered,” observed the bench.

Asking the passport officers to treat online as well as regular applications at the same level, the court observed that the rules laid down under the Passport Act 1967 should be followed properly.

“If the passport officer is satisfied after the enquiries that are required to be made that the passport must be issued with or without endorsement or should be refused, has to pass a reasoned order.
Hereafter, if applications of the above nature are kept pending without any orders being passed forcing parties to approach this court, then, we would take a serious view of the conduct of the Regional Passport Officer concerned and while allowing the request we would impose heavy costs to be paid personally by the Regional Passport Officer,” the bench added.

My Views

I myself have come across instances of cancellation of passport without issuing any valid show cause notice, without giving a personal hearing, on wrong and illogical reasons simply because the police submit some unconnected report. This illegal practice should be stopped.

Consumer Education and Research Centre
(Registered Public Charitable Trust)

January 2016 Vol. 3 No.4

COVER STORY

What hotels won’t tell you
Staying at a hotel is one of the best ways to get away from your routine and pamper yourself. Here we unveil some hotel secrets which will help you avoid unpleasant surprises and make the best of your stay. Read more

These articles will help every person know their rights as a consumer and protect their interests when the need comes to. Consumer rights protect consumers in getting their rights in many day to day things like medical insurance, flights, flats, properties, retail purchases and the knowledge of such rights will help every person throughout their lives.

Consumer Forum Help is headed by Dr. Binoy Gupta, an ex Chief Commisioner of Income Tax and a very highly learned LLB, ML and PhD in law. He and his team are sincere in their attempts at bringing rights to consumers and this website is their attempt at getting the information across to everyone.

Contact – How To Contact Us

Hello, we are always open to handling any type of case in the consumer forums in Mumbai. Please feel free to contact us for free consultation or for legal representation.

(However, we can only offer free consultation for cases in other places. But this will be a great help if you are ready to represent your own cases in Consumer Forums)

You will directly be in touch with Dr. Binoy Gupta, ex Chief Commissioner of Income Tax, LLB, ML and PhD in Law.
He has half a dozen P G Diplomas in a variety of subjects. You can search for his name on google to see the various landmark victories he has had in consumer forum against such companies as BEST, Zee, ICICI Lombard, and Insurance Companies. He specializes in cases against builders, housing societies and insurance.

Resolutions were for yesterday, today let’s get ticking on a checklist to mend Mumbai

The year got off to a great start with the Chief Minister of Delhi quoting John Lennon’s “Imagine“. That song spurred a revolution across the world, with the words You may think I am a dreamer. But I’m not the only one. Of course the Delhi CM was promoting his dream of using the oddeven rule to reduce traffic congestion and pollution. But an injection of poetry into politics is a good beginning for the New Year.Here are some simple ideas, almost poetic in their impact. Ok, not poetic per se, but such is their impact that people may break into spontaneous shayari, praising the government. These are implementable within a one-year time frame. The examples are specific to Mumbai, but surely there is similarly low hanging fruit for other cities too.

Convert all STD kiosks into public WiFi hotspots

Convert Trash to electricity

Unclog Bandra and Ghatkopar Stations

Instal Escalators at all major railway stations

All of them are do-able within a reasonable cost and within less than a year.

Do we have the will?

Click Here for the full detailed story by Ajit Ranade in Mumbai Mirror